Innovative Industrial Properties Inc. [IIP] recently announced that it has acquired industrial space in Ohio measuring 50,000 square feet in dimension for venturing into a long-term lease with Cresco Labs for its new venture.
Innovative Industrial Properties Inc. is the only company from the real estate segment to get listed on the New York Stock Exchange (NYSE: IIPR).
The property was purchased reportedly for $10.6 million. With the closing of the deal, the company has got into a long-term agreement with Cresco Labs Inc. over the property which the latter will continue to operate for cultivating and processing regulated cannabis.
Million-dollar deal with Cresco Labs
“IIP will provide a reimbursement of $1.9 million to Cresco for completing tenant improvements for the property. Considering this amount, the total investment made by IIP over the property is approximately $12.5 million.”
The sale-leaseback transaction made by IIP is its third acquisition and lease deal with Cresco. It has entered into a similar agreement with two of the licensed cannabis cultivation and processing facilities managed by Cresco in Illinois as well.
Driving innovation to deliver trusted medical marijuana products to patients
IIP as an inventive real estate investment trust (REIT) for medical cannabis enters into partnership with experienced firms and offers capital assistance to them by acquiring and leasing back real estate properties. It also offers real-estate based capital solutions. IIP made an announcement that it is excited to expand its partnership with Cresco and its dedicated team.
The company issued a press release stating that it has immense faith in the business plan of Cresco and its operations. The company is dedicated to contributing to the local communities from where they are operating.
They are thrilled with their liaison with them once again in Ohio after their Illinois deals. The company believes that Ohio presents an incredible market opportunity which Cresco can utilize to deliver trusted and high-quality products to those in need.
Cresco was established in 2013 and has grown to be one of the largest vertically-integrated cannabis companies in the United States. There are eleven states in which it is running licensed operations.
Cresco has over 18 licensed cannabis production facilities, 21 operational dispensaries for cannabis, 31 retail licenses including its pending acquisitions. The brand has been designed to meet the requirements of all consumer segments through its consumer-packaged goods approach to cannabis. The popular and trusted national brands including Mindy’s, Remedi and Sunnyside are offerings of Cresco.
Statement from Cresco on their new deal
Cresco released a statement after its recent collaboration with IIP. It said that it is ecstatic about partnering with IIP once again which will further bolster their balance sheet. The company is further looking forward to deepening its bond with its real estate partner and trusted capital provider, IIP in other states.
The licensed medical cannabis program in Ohio is still in its early stages. The first sales are expected to occur at the beginning of this year. There are nearly 80,000 patients and 8,000 caregivers registered under the program as of December 2019.
IIP owns 48 properties totally as of January 27, 2020. If we add up the total rentable square feet of the properties currently owned by the company, the total comes up to 3.1 million.
IIP has invested approximately $529.3 million and $128.3 million additionally for tenant improvements and for the completion of construction. The current yield of IIP is 13.3% on average for its 48 properties.